The SCA UAE and Crypto in 2026: Stance, Licensing, and Federal Framework

Reviewed 2026-05-28 by DeFi Intel Research Desk

What it is

The Securities and Commodities Authority (SCA) is the federal securities and commodities regulator of the United Arab Emirates, founded in 2000. It holds jurisdiction across all emirates outside the financial free zones, such as the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM). In 2026, the SCA continues to expand its remit into virtual assets, licensing crypto businesses under a federal framework established by Cabinet Decision 111/2022. Its mandate covers market supervision, investor protection, and enforcement against unlicensed financial activities in the UAE’s mainland.

Crypto framework and stance

The SCA treats crypto assets as virtual assets subject to federal securities regulation. Under Cabinet Decision 111/2022, all virtual asset service providers (VASPs) operating in mainland UAE must obtain an SCA license. The framework covers exchanges, custody providers, broker-dealers, and other intermediaries. The SCA coordinates with Dubai’s Virtual Assets Regulatory Authority (VARA) via a Memorandum of Understanding, ensuring a cohesive nationwide approach while respecting the autonomy of Dubai’s special economic zones. In 2026, the authority maintains a proactive stance, requiring robust AML/CFT compliance and capital adequacy standards, while vetting each applicant’s technology and governance. The SCA does not classify Bitcoin or Ethereum as securities but regulates the platforms and services that deal in them. The framework aligns with Financial Action Task Force (FATF) recommendations and includes strict KYC/AML requirements. The SCA’s licensing process is thorough, with ongoing reporting obligations. By 2026, multiple VASPs have received federal authorizations, signaling the SCA’s shift from pure enforcement to active market gatekeeping. The MoU with VARA prevents regulatory arbitrage and ensures firms cannot avoid oversight by switching between mainland and Dubai zones. This dual-layer approach has made the UAE one of the most comprehensively regulated crypto markets globally.

Notable actions

The SCA’s key milestones in crypto oversight include:

Federal VASP regulatory framework (2023): The formal issuance of rules under Cabinet Decision 111/2022 operationalized licensing requirements, setting clear application processes and compliance standards. This marked the UAE’s move from a fragmented to a unified national approach.
VARA-SCA coordination MoU: Signed to delineate responsibilities between the federal authority and Dubai’s dedicated virtual asset regulator. The MoU ensures that VASPs are licensed by the appropriate body based on geographic location and client base, eliminating regulatory gaps.
Multiple VASP federal authorisations: By 2026, the SCA has granted licenses to a growing number of exchanges, custodians, and fintech firms. Each authorization signals that the applicant meets high standards for custody, cybersecurity, and investor protection, bolstering the UAE’s reputation as a responsible crypto hub. These actions demonstrate the SCA’s transition from observer to active regulator. The framework isn’t theoretical—enforcement actions against unlicensed operators have followed, though specifics remain closely held. The licensing process is seen as rigorous but feasible, attracting global players seeking a gateway to the Middle East.

Key figures

The SCA is led by CEO Dr. Maryam Al Suwaidi, a key architect of the UAE’s securities modernisation. Under her tenure, the authority has expanded its digital asset oversight, pushing for clear rules that attract institutional participation while upholding investor safeguards. Dr. Al Suwaidi has publicly advocated for balanced regulation that fosters innovation without compromising market integrity.

What it means for users and builders

For crypto businesses, the SCA framework creates a clear path to launch in mainland UAE: obtain a VASP license, meet capital and compliance thresholds, and maintain ongoing reporting. This provides legal certainty absent in many jurisdictions, enabling access to a wealthy, tech-savvy market. For users, SCA oversight means platforms must segregate customer assets, maintain robust cybersecurity, and adhere to AML rules, reducing counterparty risk. However, the licensing process is not trivial; fees and documentation requirements can be steep for startups. Builders should note that Dubai’s free zones remain under VARA, so a hybrid strategy may be needed if targeting both areas. In 2026, the UAE is seen as one of the more predictable regulatory environments, but compliance costs are real.

Outlook

The SCA is expected to further codify treatment of novel crypto activities like DeFi and NFTs, possibly issuing additional guidance or rulebooks in 2026–27. Coordination with VARA will likely deepen, potentially leading to passporting arrangements that simplify licensing across zones. As the UAE aims to be a global digital-asset hub, the SCA will balance innovation with strict AML enforcement, watching developments from the SEC ↗ and FCA ↗ for international alignment.

DeFi Intel publishes editorial research, not financial advice. Do your own research and consult a licensed advisor for your situation.

Frequently asked questions

Does the SCA regulate cryptocurrency in the UAE?

Yes, the Securities and Commodities Authority (SCA) regulates virtual assets and virtual asset service providers (VASPs) across mainland UAE, outside the financial free zones like Dubai’s VARA. It licenses and supervises exchanges, custodians, and other crypto businesses under Cabinet Decision 111/2022.

What is Cabinet Decision 111/2022?

Cabinet Decision 111/2022 is the UAE’s federal decree that established the regulatory framework for virtual assets and VASPs, mandating SCA licensing for firms operating in the mainland emirates. It defines virtual assets and sets out licensing, AML, and supervisory requirements.

How does the SCA coordinate with Dubai’s VARA?

The SCA and Dubai’s Virtual Assets Regulatory Authority (VARA) operate under a coordination Memorandum of Understanding (MoU). VARA oversees crypto activities within Dubai’s special development zones and free zones, while the SCA covers the rest of the UAE. The MoU streamlines oversight and prevents regulatory overlap.